Can a Person Have Group Health Insurance and Medicare Coverage?

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Doctor talking with senior couple
Doctor talking with senior couple (Image: Jupiterimages/Stockbyte/Getty Images)

Turning 65 is all most people need to do to qualify for Medicare. If you reach that age and you're eligible for Social Security, you're usually eligible for Medicare Part A and B as well. Medicare Part A handles hospital stays and similar expenses. Part B takes care of doctors visits and preventive care. Having group health insurance doesn't affect your eligibility, but it may affect whether Medicare or your other insurer pays a particular bill.

Payers and Benefits

When you have more than one insurance -- group insurance, Medicare, Medicaid and so forth -- the different payers coordinate benefits. One payer goes first and exhausts its coverage. Then the second payer steps up and covers some or all of what remains. No matter how good your coverage, you won't get two payments for the same expenses. The first payer refers only to who has primary responsibility -- it's possible your second payer's check could reach you first.

Work and Age Factors

Suppose you have group health insurance because you or your spouse are still working when you turn 65. If your employer has a staff of 20 or more, your group insurance becomes primary payer. For companies with fewer employees, Medicare pays first. If you're retired and still receive coverage as a retirement benefit, Medicare pays before the group health plan. If you're disabled, Medicare pays first unless your employer has 100 or more people on the payroll. Different rules apply in other special cases.

How It Works

Happily it's not your responsibility to divide the bill and tell your dual payers what to pay. When you only have a single payer, the doctor bills the insurer or Medicare for you. With two payers, it's still the doctor's job. If the group coverage is first payer and doesn't cover the whole bill, the doctor will contact Medicare with a list of what remains unpaid. When both payers have settled up, the doctor will send you a bill for any remaining costs.

Weighing Options

If you decide sticking with Medicare 100 percent is more affordable than group coverage, you can drop the latter. However, Medicare won't penalize you for not having other coverage. Retiree health insurance, the Center for Medicare and Medicaid Services says, is often written specifically to cover things Medicare does not, so review and compare coverage before acting. You also can compare your group insurance to the cost of a Medigap policy. Medigap insurance plans are written to cover some of the costs Medicare doesn't pick up.

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